Earnings
The same as net income or net profit.
|
Economic life
Same as service life or useful life. The period of time that an asset is expected to provide benefits.
|
Economic resource
A good or service that is acquired by an entity that is expected to provide future benefits.
|
Elements
In accounting, the elements refer to the general ledger accounts.
|
Employee
A person who works for another in exchange for financial compensation.
|
Ending inventory
The amount of inventory on hand at the end of an accounting period.
|
Entity
In business, it is referred to as a separate organization unto itself. In accounting, it is an organization for which a set of accounts is kept.
|
Entrepreneur
One who organizes, operates, and assumes the risk in a business venture in expectation of gaining the profit.
|
Entry
A transaction that is recorded in the books.
|
Equity
The value of assets above any liabilities.
|
Expenditure
The purchase of goods or services by cash or credit that have not expired or been used yet.
|
Expense
1) All goods and services or any resources that are acquired are considered to be an asset of an entity. When an asset is used or consumed it is considered to be an expense resulting in a decrease in equity. 2) An expenditure made to acquire an asset is an unexpired cost. An expired cost is an expense. 3) Revenue increases equity, expenses decrease equity.
|
Expense rule
One of the five rules of operation of financial statements. When an asset is "used" it becomes an expense that must be Recognized (recorded) within the accounting period in which it was consumed.
|
Expensing
The process of charging the cost of an asset to expense resulting in a debit to the general ledger accounts.
|
Expired cost
Same as expense.
|